PSigma believes that this new fund of funds will prove timely in the current volatile markets and attract investors seeking real rates of return, and not simply a fund that aims to outperform benchmarks.

The fund’s objective is to achieve long-term capital growth and total return, investing in collective investment schemes, unit trusts, OEICs, investment trusts, hedge fund of funds and exchange-traded funds (ETFs).

The PSigma Balanced Managed Fund of Funds will be managed by Tom Becket and is likely to have a bias towards the global equity markets where there are attractive growth prospects.

Minimum investment: £10,000 (additional investments £1,000)
Initial charge: 5.25 per cent
Annual management fee: 1.5 per cent
Contact: www.psigma.com

Philip Johnson says:
Initially, the fund will apply a defensive stance to asset allocation. This is due to PSigma’s continuing fears over the outlook for the global economy and that they view the outlook for equity markets as finely balanced. Equity markets are likely to remain pressurised in the short term; however, it is expected that the fund will deliver positive returns in this bear market.

It is the intention to start the portfolio with about 40 per cent in equities, skewed towards international markets, where the managers think they will see a greater opportunity in a low-growth environment and the potential for enhanced returns from ongoing sterling weakness. The managers particularly like to use funds with flexible global mandates, among which Graham French’s M&G Global Basics will be a core holding.

One of the favoured areas at present is Healthcare, where the attractions are the short-term defensive characteristics and longer-term growth potential of the sector, as a healthcare revolution is likely to develop, driven by emerging market demand for improved medicine and medical technology. Here the fund will use Polar Capital’s Healthcare Opportunities, whose managers, it is felt, are best placed to select high-quality growth companies in a notoriously difficult sector.

I believe that multi-asset portfolios are a good way to help reduce risk and generate good returns through all market conditions. Looking at the structure of this fund I think this has the potential to succeed. I like it because it’s a bit different. It is different because it does not rely on the traditional split between property, equity and fixed-interest.

Two final thoughts, I would like to have seen a lower minimum investment and a regular savings option.

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